Demetriou’s comments not misleading

Optus’ TV Now service was held earlier this month by the Federal Court not to infringe the AFL or NRL’s copyright in their match broadcasts. Following the Court’s decision the Australian Football League’s Chief Executive Andrew Demetriou, in a wide-ranging interview with the Herald Sun made a number of comments surrounding the case and Optus’ conduct. The comments suggested that Optus “lifted” the AFL’s copyrighted content and this was “akin to stealing”. In response on 21 February Optus launched proceedings in the Federal Court against the AFL and Mr Demetriou arguing that the statement’s made by the League’s CEO were ‘misleading or deceptive’ and therefore contravened Section 18 of Schedule 2 of the Australian Consumer Law.

Justice Edmonds today held Mr Demetriou’s comments were not ’misleading or deceptive’ and as such dismissed Optus’ application with costs.

The continuing dispute between the major football codes, telco heavyweight Telstra and Optus centres on Optus’ TV Now. The service, as reported by FrostGlobal, allows subscribers to remotely record free-to-air TV shows across mobile, table or PC devices. The recordings are recorded in multiple formats in the ‘Cloud’ i.e. at various Optus data centres. When a user accesses a recording, it is streamed over Optus’ network to the customer’s device. The recording is available for viewing for up to 30 days.

The AFL, NRL and Telstra argued that Optus’ system infringed the copyright that the football codes and licensee Telstra had in various match broadcasts. The Court held that Optus had not infringed the football codes’ copyright because Optus could successfully rely on s111 of the Copyright Act, which allows a person to record a TV broadcast if it is for personal use i.e. to watch at a more convenient time. Justice Rares, in that decision held that the user ‘clicked’ the record button despite Optus providing the technical infrastructure for recordings to occur. This was akin to an individual using a VCR to record a television show and therefore Optus was not making the recordings but its users were making the recordings.

The outcome of the Federal Court hearing has provoked much debate amongst the community.  Mr Demetriou was asked to comment on the case in an interview with the Herald Sun. The interview covered a wide range of AFL and non-related AFL matters. The comments that Optus alleged were ‘misleading or deceptive’ included the following:

“The thought of Optus deciding to lift our content and not pay for it, and pretend and purport to be doing it for the consumer, is a complete disgrace….they are not paying for it; they are lifting it. It is akin to stealing and all it will do is that if sports can’t rely on that revenue, they will slug the consumers.”

“I think they [politicians] are looking for a way for the legislation to catch up with technology…It would be far more preferable if Optus just dropped this shenanigans and into the real commercial world and starting just paying for things.”

In today’s judgment the Federal Court held that for there to be ‘misleading or deceptive’ conduct in contravention of the Australian Consumer Law, the comments must have been:

  1. made “in trade or commerce”; and
  2. if the comments were in “trade and commerce” they  were “misleading or deceptive or likely to mislead or deceive”.

On both limbs Justice Edmonds held that the comments were not ‘misleading or deceptive’ in ‘trade or commerce’.

The comments by Mr Demetriou, according to Justice Edmonds “were value judgments about the integrity and conduct of Optus in relation to the recording of content in respect of which the AFL owned copyright” and therefore fell outside the definition of trade & commerce. Even if the first element was satisfied the comments were not ‘misleading or deceptive’ as Mr Demetriou held the opinions honestly; and in any event given their context where Optus’ service uses Optus equipment to broadcast and stream games in which AFL holds the copyright and “Optus does not pay anything to the AFL for the content that Optus makes available for its own commercial gain to its customers”, the comments were not ‘misleading or deceptive’.

The legal action by Optus over Mr Demetriou’s comments was a sideshow to the main game, the issue of redistribution of AFL/NRL match broadcasts by a telecommunications company that is not the mobile/internet rights holder of that competiton.  That fight (Optus v NRL) is continuing as the AFL and others have appealed the decision with the next hearing to be held on the 14th and 15th of next month.

It does not appear that this dispute will end any time soon.

FrostGlobal will keep readers posted of any new developments in this complex but commercially critical dispute.


SingTel Optus Pty Limited v Australian Football league [2012] FCA 138 (28 February 2012)

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